Natives Happy In Squalor: Coonan

Communications Minister Helen Coonan says most Australians are happy with the speed of their broadband connections.

And why shouldn’t they be? The fact that the rest of the world lives in brick houses with air conditioning has never worried Congolese Pygmies. Why should the fact that our broadband service is the worst in the developed world worry us?

I recommend you all start to pay your taxes in grain or livestock, to reflect the government’s admission that we are now a third-world country.

Well, she says we’re happy with the speed and I’m not too fussed with that, but it’s the price that I pay that shits me. And that’s the crucial thing – if we’re connecting at sub-European/US speeds, we should be paying sub-European/US prices.

Telstra artificially limits the speed of ADSL broadband in Australia to 1.5Mbit/second. This is the minimum speed allowed in Canada for a company to legally market their service as “Broadband Internet”.

The majority of broadband users in Australia connect at speeds that would be illegally slow under Canadian law.

I don’t blame Telstra management for abandoning its fibre-to-the-node investment. Its first duty is to its shareholders and spending 4 billion of their money to build an asset that its competitors can access for less than its true cost is simply not a good investment.

The problem goes back to the initial privatisation of Telstra, and the same principle applies to the privatisation of any natural monopoly. To hive off a business to private shareholders and then control its prices isn’t privatisation. It’s called having two bob each way.

I believe that all businesses should be privately run – governments are notoriously unable to run them.

But physical infrastructure is something different. Governments must build and maintain infrastructure like water, copper wire phone grids, power and gas grids, major airports, major roads etc that cannot logically be subject to competition. However aspects of provision of services needing these infrastructures that can be provided competitively should be privatised. The government should have retained the fixed line telephone infrastructure when Telstra was privatised, so that the various telecommunications companies can provide services by paying rental to the government for access to the grid. Similarly it should be a government function to set up the fibre-to-node network and charge usages to Telstra, Optus etc.

With respect to free-to-air TV and radio licences, my understanding is that the physical limitations on the number of licences has faded off completely in recent times, so there’s no call for the government to control entry to these services any more. The Packers and the Stokeses etc should now sink or swim against virtually unlimited competition